Apple Adds IPad With More Memory

Apple Inc. (AAPL) debuted an iPad with
twice the memory of existing models, offering users more space
to store movies, videos and books amid mounting competition in
the tablet market.

The new iPad with 128 gigabytes of storage will be
available starting Feb. 5, priced at $799 for a Wi-Fi version
and $929 for a device that also offers a cellular connection,
Cupertino, California-based Apple said today in a statement.

Apple bolstered its product lineup in October with the iPad
mini, priced from $329 to $659, and a fourth-generation iPad
that costs $499 to $829, depending on the features. The latest
iPad model comes as as Apple works to fend off challengers from
Amazon.com Inc. (AMZN) and Microsoft Corp. (MSFT) in the market for tablets,
which NPD DisplaySearch has estimated will more than double to
$162 billion by 2017.

“The tablet market is expanding, and Apple sees a market
opportunity, not just at the low end but also in the high end
with heavy media consumers,” Tavis McCourt, an analyst at
Raymond James & Associates, said in an interview.

Apple rose 1.9 percent to $458.27 at the close in New York.
The stock has declined 14 percent this year, making it the
worst-performer in the S&P 500 Information Technology Index.

Earlier this month, Apple posted the slowest profit growth
since 2003 and the weakest sales increase in 14 quarters,
fueling concern about Chief Executive Officer Tim Cook’s ability
to keep producing hit products more than a year after the death
of co-founder Steve Jobs.

‘120 Million Sold’

Apple said the added memory will be especially useful to
businesses that use use heavy amounts of data and need more
storage capabilities. The iPad is used for storing project
blueprints, training videos, service manuals, X-rays and other
data-heavy files. Nearly all Fortune 500 companies are using the
iPad, Apple said.

Corporations will account for about 11 percent of tablet
shipments in 2013, up from 8.3 percent in 2012, according to
IDC. Microsoft has been trying to appeal to this market with its
new Surface tablets.

“With more than 120 million iPads sold, it’s clear that
customers around the world love their iPads, and every day they
are finding more great reasons to work, learn and play on their
iPads rather than their old PCs,” Philip Schiller, Apple’s
senior vice president of marketing, said in the statement.

The more expensive iPad model follows the same strategy
Apple employed when its Mac computers were challenged by lower-
priced rivals, McCourt said.

“This is Apple logic,” he said. “When cheap netbooks
were popular and taking over, Apple upgraded, rebranded, and
raised the price of their MacBooks.”

Apple could apply this same high-end strategy to the iPhone
with future models of the handset, McCourt said.

Even so, Apple also is seeing demand for its lower-cost
alternatives. Apple said last week that the iPhone 4, the least-
expensive model available, and the iPad mini were sold out for
much of October, November and December.